This article is provided for informational purposes only and does not constitute legal advice. Dealers should consult qualified legal counsel regarding compliance with the California CARS Act and any other applicable state or federal regulations.
The California Combating Auto Retail Scams (CARS) Act (SB 766) went into effect on October 1st. Designed to increase pricing transparency and protect buyers, the law introduces operational compliance requirements across dealership sales, F&I, and digital retailing.
While software vendors and digital retail platforms have updated system settings to meet these new standards, SB 766 impacts daily operations beyond just what’s on your website.
Here are three primary pillars of the CA CARS Act that every dealership leadership team needs to know.
Upfront “Total Price” Transparency Across All Channels
SB 766 eliminates hidden fees by requiring dealers to disclose the vehicle’s “total price” in applicable advertisements and in the first written communication regarding a specific vehicle, price, or financing offer. So any advertised price or written quote (including email and text) must represent the “total price” required to purchase the vehicle.
There are permitted exclusions, however. These are limited strictly to mandatory government taxes, state/DMV title and registration fees, and regulated document processing fees.
When monthly payment estimates are presented, dealers must provide accompanying disclosures regarding the financing assumptions and payment terms used to generate those estimates.
Clear Rules for Optional F&I and Accessory Add-Ons
The law also lays out standards for backend add-ons and protection products to ensure customers know that optional items are, well, optional.
Mandatory “Optional” DisclosuresAccessories, protection plans, and F&I products must be explicitly labeled as optional.
Elimination of Non-Beneficial Add-Ons Sellers cannot charge for add-on products or services that have no practical or economic value to the buyer, for example, an oil change package for an electric vehicle.
Itemized Pricing BreakdownAll dealer-installed accessories and optional backend products should be clearly disclosed separately from the vehicle’s base price to ensure buyers know exactly what they are purchasing.
Mandatory 3-Day Returns on Eligible Used Purchases/Leases
Many used vehicle retail sales and leases of $50,000 or less are subject to a mandatory 3-day cancellation policy, subject to eligibility requirements and statutory exceptions.
Buyers will have a right to return/cancel a purchase or lease for 3 calendar days for any reason, subject to the law’s mileage, timing, and condition requirements.
Checklist: Next Steps for Your Store
Here’s a quick checklist to help you review your store’s compliance with SB 766.
Audit Sales & BDC Templates Ensure your templates and quote sheets display the vehicle’s required total price where applicable.
Review F&I and Accessory MenusVerify your pre-loaded dealer accessory packages offer clear utility and are properly marked as optional.
Train Staff on Pre-Owned Return ProtocolsEstablish processes for handling 3-day used vehicle returns.
Maintain 2-Year RecordsImportant things to archive include published ads, initial pricing communications, worksheets, and cancellation logs for a minimum of two years.